PT Kreasindo Resources

“An Indonesian company is exploring a plan with an Iranian partner to build an oil refinery in Java as the two nations are seeking to boost trade and investment ties after an easing of global economic sanctions on Tehran. PT Kreasindo Resources Indonesia on Tuesday signed a preliminary agreement with Iran's Nakhle Barani Pardis Co. to build the refinery, which will require around $3 billion in investment, either in Banten Province or another location in West Java, said Rudy Radjab, the president of the Indonesian company. Mr. Radjab said the two companies would decide later this year if they will proceed with the plan. Kreasindo plans to hold a 70% stake in the project, which in its initial stage would be able to produce 150,000 barrels a day of crude. Nakhle would hold the remaining 30% and also help supply the crude-oil feedstock. ‘We signed an agreement with Nakhle to supply between 20,000 and 300,000 barrels a day of crude from Iran as we could expand the capacity of the planned refinery to up to 300,000 barrels a day in the future,’ Mr. Radjab told The Wall Street Journal…Indonesia has been inviting investors to build refineries in the country to meet rising domestic demand as a result of robust growth in the past five years. State-owned PT Pertamina currently operates seven refineries across the country, with total capacity of one million barrels a day, or about two thirds of domestic consumption. But its efforts haven't been fruitful, as investors have asked for various tax breaks that the government couldn't provide.” (Wall Street Journal, “Indonesian, Iranian Companies Look to Build Oil Refinery,” 2/11/14)